The Chinese case in particular is reviving a ... myth of how ... development
authoritarianism delivers much more than democracy. This is also backed by the
memory of impressive economic performance of other East Asian authoritarian
regimes (like those in South Korea and Taiwan...). The lingering hope of
democrats had been that as the middle classes prosper in these regimes, they
then demand, and in the latter two cases got, the movement toward political
democracy.

But... Authoritarianism is neither necessary nor sufficient for economic
development. That it is not necessary is illustrated ... by scattered cases of
recent development success: Costa Rica, Botswana, and now India. That it is not
sufficient is amply evident from disastrous authoritarian regimes in Africa and
elsewhere. ...

[I]t is worth reiterating the several advantages of democracy from the point
of view of development. Democracies are better able to avoid catastrophic
mistakes, (such as China’s ... massive mayhem in the ... Cultural Revolution),
and have greater healing powers after difficult times. Democracies also
experience more intense pressure to share the benefits of development among the
people, thus making it sustainable, and provide more scope for popular movements
against industrial fallout such as environmental degradation. In addition, they
are better able to mitigate social inequalities ... that act as barriers to
social and economic mobility and to the full development of individual
potential. Finally, democratic open societies provide a better environment for
nurturing the development of information and related technologies, a matter of
some importance in the current knowledge-driven global economy. ...

All that said,... democracy can also hinder development in a number of ways.
Competitive populism– short-run pandering and handouts to win elections– may
hurt long-run investment, particularly in physical infrastructure... Finally,
democracy’s slow decision-making processes can be costly in a world of
fast-changing markets and technology.

The hopes of democrats relying on the middle classes in authoritarian regimes
have not always borne fruit. Latin American or South European history has been
replete with many episodes of middle classes hailing a supreme caudillo. The
police state in China shows no signs of loosening its grip soon... Most people
in the Chinese middle class are complicit in this in the name of preserving
social stability, as long as opportunities for money-making and wallowing in
nationalist pride keep on thriving.

So markets and capitalism will not do their political cleansing job
automatically. On the contrary, markets often sharpen inequality, and the
resultant structures of political power, buttressed by corporate plutocrats and
all-powerful lobbies, may even hijack or corrupt the democratic political
process, a phenomenon not unknown in some industrial democracies. Thus both for
democracy and development, other social forces and movements for civil and
economic rights for the common people have to be pro-active and eternally
vigilant.

Industrial policy is, essentially, economic authoritarianism. Is it the industrial policy component of the more general authoritarianism in place in many countries that helps with development? If so, couldn't it work just as well,
maybe even better, in a democracy?

The Chinese case in particular is reviving a ... myth of how ... development
authoritarianism delivers much more than democracy. This is also backed by the
memory of impressive economic performance of other East Asian authoritarian
regimes (like those in South Korea and Taiwan...). The lingering hope of
democrats had been that as the middle classes prosper in these regimes, they
then demand, and in the latter two cases got, the movement toward political
democracy.

But... Authoritarianism is neither necessary nor sufficient for economic
development. That it is not necessary is illustrated ... by scattered cases of
recent development success: Costa Rica, Botswana, and now India. That it is not
sufficient is amply evident from disastrous authoritarian regimes in Africa and
elsewhere. ...

[I]t is worth reiterating the several advantages of democracy from the point
of view of development. Democracies are better able to avoid catastrophic
mistakes, (such as China’s ... massive mayhem in the ... Cultural Revolution),
and have greater healing powers after difficult times. Democracies also
experience more intense pressure to share the benefits of development among the
people, thus making it sustainable, and provide more scope for popular movements
against industrial fallout such as environmental degradation. In addition, they
are better able to mitigate social inequalities ... that act as barriers to
social and economic mobility and to the full development of individual
potential. Finally, democratic open societies provide a better environment for
nurturing the development of information and related technologies, a matter of
some importance in the current knowledge-driven global economy. ...

All that said,... democracy can also hinder development in a number of ways.
Competitive populism– short-run pandering and handouts to win elections– may
hurt long-run investment, particularly in physical infrastructure... Finally,
democracy’s slow decision-making processes can be costly in a world of
fast-changing markets and technology.

The hopes of democrats relying on the middle classes in authoritarian regimes
have not always borne fruit. Latin American or South European history has been
replete with many episodes of middle classes hailing a supreme caudillo. The
police state in China shows no signs of loosening its grip soon... Most people
in the Chinese middle class are complicit in this in the name of preserving
social stability, as long as opportunities for money-making and wallowing in
nationalist pride keep on thriving.

So markets and capitalism will not do their political cleansing job
automatically. On the contrary, markets often sharpen inequality, and the
resultant structures of political power, buttressed by corporate plutocrats and
all-powerful lobbies, may even hijack or corrupt the democratic political
process, a phenomenon not unknown in some industrial democracies. Thus both for
democracy and development, other social forces and movements for civil and
economic rights for the common people have to be pro-active and eternally
vigilant.

Industrial policy is, essentially, economic authoritarianism. Is it the industrial policy component of the more general authoritarianism in place in many countries that helps with development? If so, couldn't it work just as well,
maybe even better, in a democracy?